Utah homeowners insurance rates have skyrocketed

SALT LAKE CITY —‚ The cost of Utah homeowners insurance has skyrocketed over the past few years. Data from S&P Global showed that in 2023, Utahns spent about 52% more on homeowners insurance than they did in 2018. 

According to Jon Pike, Utah’s insurance commissioner, the biggest causes of the increase are inflation and housing costs. 

“If the costs of those things are going up, then of course the insurance costs are going to go up,” said Pike. “We’re seeing last year [and] this year in a roughly 19 [to] 20%. Which is very high, that’s quite high especially compared to the few years before that.”

Secondly, Pike said that location is a factor. Between 2011 and 2020, over 6,000 homes were built in areas considered high-risk of wildfire damage. 

“What that tells me, as an insurance person, [is] that [it] is kind of upping our risk level,” said Pike. 

The state has ranked second in the nation for building in fire-risk areas. 

Along with sticker shock, some Utah homeowners in those areas have been denied coverage. 

Residents used to cheaper Utah homeowners insurance costs

The average rate increase for Utah homeowners insurance is the third highest in the nation. Previously, that was not the case. 

Utahns are used to having very low-cost homeowners insurance rates, compared to the rest of the country. According to Pike, the usually low costs are the biggest reason for the dramatic spike. 

“They’re catching up. The insurance companies are kind of saying ‘Yeah our rates are not adequately reflecting our costs and our risks in Utah and therefore, we’re seeing more of an increase,” said Pike.